Lesson Plan

Class: 12

Subject: Elements of Accounts

Topic: Accounting Ratios

Teaching Periods: 12 periods of 40 minutes

General Learning Objectives:

Understand the meaning of accounting ratio
Classify the accounting ratios
Learn the objectives and importance of accounting ratios
Learn the various accounting ratios based on profitability, liquidity,
solvency and activity

Instructional Objectives:
explain various types of accounting ratios i.e. solvency, profitability and
liquidity ratios;
calculate the various ratios on the basis of given information;
describe the limitations of accounting ratios.

Testing previous knowledge:

Teacher will provide a handout to students to check the knowledge about
various components of different ratios.

Teaching Method:
1) Discussion Method
2) Demonstration Method
3) Lecture Method
 Transaction of Lesson:
Then next are the liquidity
rartios. Discussions are led
Students to answer at this point on the
the question: How do importance of liquidity in
business and the cost of
business measure cash lying idle with the
success? business. Again students
solve questions based on
it
Activity ratios are
discussed wherein the
importance of such
information on business
decision making is also
brought to their notice.
After understnading the
formulas students solve
questions .

The next focus will be on

In a handout, income
different types of ratios. At last various solvancy
statement and balance
First we begin with ratios are discussed to
sheet of three companies
profitability ratios. After help them understand how
are given for evaluation.
explaining the ratios to measure solvancy of a
Students have to find out
students will solve business. Students solve
which is the most
questions based on these questions
successful company
ratios

Students will realize that it

is not easy to measure
them as all are good from
any one factor but lacking
in others, that is when
they will understand the
need of some tool to
measure financial
information
Teaching Aids:
1) Text Book
2) Boards
3) Chalks and Markers
After understanding all the
After understanding the
types of ratios, teacher
importnace of ratio
helps students inmaking
analysis, components of
use of these ratios to
ratio will be discussed with
measure success of a
the help of a handout
business

Application:
The students will apply the learnt knowledge in:
1) This knowledge will form a base for future studies of Accountancy.
2) This knowledge will also give a base to its practical implications in learning
other ratios further.
3) This knowledge will also give a base to its practical implications while they
do their own business or work for someone.
Home Assignment:
Students will be assigned the questions of practice book.